ISMAEL A. MATHAY, JR., PETITIONER, VS. VICTOR C. MACALINCAG, UNDERSECRE­TARY OF FINANCE, THE CITY ASSESSOR OF QUEZON CITY, AND THE CITY TREASUR­ER OF QUEZON CITY, RESPONDENTS.

On March 21,1991, Ismael A. Mathay, Jr., describing himself as
“a member of Congress, and registered owner of lands in Quezon City and
resident of Metro Manila,” instituted in this Court a special civil action
of prohibition against Victor Macalincag, then the Undersecretary of Finance,
the City Assessor and the City Treasurer of Quezon City. The action was docketed as G.R. No. 97618.

His petition sought the perpetual enjoinment, as unconstitutional
and void, of “(a) the schedule of market values prepared by respondent
City Assessor for all classes of real property
situated in Quezon City (“to
take effect not earlier than January 1, 1991,” and “implemented
gradually over a three-year period on a 1/3 2/3 2/3 scheme”), (b) the approval of said schedule by
respondent Victor Macalincag, (c) the revised and/or increased assessments of
the properties prepared by the City Assessor based on the illegal schedule of
market values, and (d) the oppressive and excessive real estate tax increases
being implemented by respondents City Assessor and City Treasurer pursuant to
the illegal schedule of market values and unlawful approval, all in violation
of the Constitution and laws. The
essential foundation of the petitioner’s thesis of the nullity of the schedule
of market values is that it was prepared by the respondent City Assessor alone,
independently of the other City Assessors within the Metropolitan Manila Area,
this being in patent violation of the explicit requirement of Section 9 of
Presidential Decree No. 921, viz.:

“SEC. 9. Preparation
of Schedule of Values for Real Property within the Metropolitan Area. — The Schedule of Values that will serve as
the basis for the appraisal and assessment for taxation purposes of real
properties located within the Metropolitan Area shall be prepared jointly by
the City Assessors of the Districts created under Section one hereof, with the
City Assessor of Manila acting as Chairman, in accordance with the pertinent
provisions of Presidential Decree No. 464, as amended, otherwise known as the
Real Property Tax Code, and the implementing rules and regulations thereby
issued by the Secretary of
Finance.”

The “City Assessors of the Districts created under Section
one” above referred to — apart from the City Assessor of the First
District, Manila, who as aforestated, shall act “as Chairman” — are
the City Assessors of the second District: Quezon City, Pasig, Marikina, Mandaluyong, and San Juan; of the Third
District: Caloocan City, Malabon,
Navotas, and Valenzuela; of the Fourth District: Pasay City, Makati, Parañaque, Muntinlupa, Las Piñas, Pateros, Taguig.

The statutory requirement of joint or collective action is echoed
in the regulations promulgated by the Department of Finance (No. 7-77) on July
25, 1977, Section 1.02 of which provides that “Schedule of Market Values
for real property situated within the Metropolitan Manila area shall be
prepared jointly by the City Assessors of the Districts created under Section 1
of Presidential Decree No. 921, with the City Assessor of Manila, acting as
Chairman.”

On the same day, March 21, 1991, this Court issued “a
TEMPORARY RESTRAINING ORDER effective immediately and continuing until further
orders ** ordering the respondents to CEASE and DESIST from implementing the
new increased assessments of real properties in Quezon City” it being made
clear, however, that “taxpayers are required to pay under the old
assessments.” The Court also set the case for hearing on Tuesday, April
23, 1991.

Six (6) days later, a similar action was initiated in this Court
by Rufino S. Javier — describing himself as “the Congressman of the Lone
District of Pasig, Metro Manila ** (and) a real property estate owner in Pasig
** ” — this time against Victor C. Macalincag, as Undersecretary of
Finance, and the Municipal Assessor and the Municipal Treasurer of Pasig, Metro
Manila. The action was docketed as G.R.
No. 97760. On the same legal theory as
that espoused by petitioner Mathay in the first action, Javier’s petition sought
the permanent proscription of the enforcement of “the unreasonably
burdensome, unjust and confiscatory increase” in the assessment of real
estate in Pasig.

On April 23, 1991, several persons filed a motion to intervene as
petitioners in the action, identifying themselves as: “Legal Management Council of the Philippines, Eliseo B. Alampay,
Custodio G. Parlade, Vicente A. Macatangay, Jr., Casiano O. Flores, Primo L.
Agsaoay, Pepito Abrajano, Leonila P. Reyes, ** residents of Quezon City **
(suing) in their behalf and in behalf of ALL OTHER RESIDENTS OF QUEZON CITY
SIMILARLY SITUATED,” and alleging that they “have direct, legal and
and material interest in the success of the main petition at bar,” and the
“subject matter of the present controversy is one of common or general
interest to all owners of real estate properties in Quezon City” in whose
behalf the intervention is essayed.

At the hearing of April 23, 1991, the Court heard the petitioners
and respondents (who had in the meantime filed their comments on the petitions)
in the two (2) actions: G.R. No. 97618
and G.R. No. 97760. It thereafter
issued a Resolution inter alia admitting the petition in intervention
and resetting the hearing of both cases to Thursday, May 16, 1991.

After the Court had again
heard the parties on May 16, 1991, it issued a Resolution containing the following
disposition, to wit:

“It being the petitioners’ and intervenors’ principal
complaint that they were not accorded adequate opportunity to ventilate their
objections to the procedure followed in the establishment of the new assessment
levels and to adduce evidence relative to the correctness and reasonableness
thereof, and there being agreement on all sides that in view of the suspension
of the ‘enforcement of the new real property tax without prejudice to its
enforcement when factual factors and considerations later warrant,’ a
re-examination of the specific rates thereof may be undertaken at this time in
light of said petitioners’ and intervenors’ objections as well as such evidence
as they may wish to submit, the Court, in the exercise of its extraordinary or certiorari
jurisdiction, Resolved to REFER both these cases, G.R. No. 97618 and G.R. No.
97760, to the Central Board of Assessment Appeals for hearing and determination
upon the issues therein raised and such evidence as the parties may present,
and to DIRECT said Board to SUBMIT to the Court a copy of its final judgment
forthwith upon its rendition. * * *. “

On the same day, May 16, 1991, as in the first action (G.R. No.
97618), a temporary restraining order was issued in this second one,
“ordering the respondents to CEASE and DESIST from implementing the new
increased assessments of real properties in Pasig, Metro Manila,” it also
being made clear, however, that “taxpayers are required to pay under the
old assessments.”

On November 5, 1991, the Court issued a Resolution clarifying its
earlier one of May 16, 1991. It pointed
out that the authority of the Central
Board of Assessment Appeals “to take cognizance of the factual issues
raised in these two cases by virtue of the referral by this Court in the
exercise of its extraordinary or certiorari jurisdiction should not be
confused with its appellate jurisdiction over appealed assessment cases under
Section 36 of P.D. 464 otherwise known as the Real Property Tax Code. The Board is not acting in its appellate
jurisdiction in the instant cases, but rather, it is acting as a
Court-appointed fact-finding commission to assist the Court in resolving the
factual issues raised in G.R. Nos. 97618 and 97760.”

A third special civil action of prohibition impugning the
increase of real property assessment levels, this time in respect of land
located in Makati, was instituted on November 4, 1991 by Consuelo Puyat-Reyes,
describing herself as “a registered owner of real estate property in the
Municipality of Makati and ** the incumbent Congresswoman of the District of
Makati, Metro Manila **.” Impleaded as respondents were the Secretary of
Finance (acting through the then Undersecretary Victor C. Macalincag), the
Municipal Assessor and the Municipal Treasurer of Makati. Acting thereon, the Court, by Resolution
dated November 12, 1991, referred the case to the Central Board of Assessment
Appeals “pursuant to the resolution dated May 16, 1991 in G.R. No. 97618
(Mathay vs. Undersecretary of Finance, et al.) and G.R. No. 97760 (Javier vs.
Undersecretary of Finance, et al.) and clarified in the resolution of November
5, 1991,” and issued a “TEMPORARY RESTRAINING ORDER ** ** ordering
the respondents to CEASE and DESIST from enforcing the revised real property
assessments and from collecting the
increased rates of real estate taxes based thereon in Makati.”

The Central Board of
Assessment Appeals thereupon proceeded to act on the cases. It opted to hear G.R. No. 97618 (CBAA Case
No. 261) separately from G.R. No. 97760 “in order ** to independently
determine the merits of the said two cases, the issues therein raised and such
evidences presented by the parties.”

It rendered a Decision in
G.R. No. 97618 (CBAA Case No. 261) on February 24, 1993,^[1] which it transmitted in due course to this Court
on March 11, 1993 together with the
“records of the case consisting of 426 pages.” It found for the petitioner, Ismael A. Mathay, Jr.,
and sustained his theory by the following ratiocination:

“Section 9 of P.D. 921 is specific and mandatory. The undisputed fact that the City Assessor
of Quezon City solely prepared the Schedule of Market Valaues in question;
without the participation of the other City Assessors of Metropolitan Manila,
with the City Assessor of Manila acting
as Chairman (SEE Exhibit ‘K,’ Letter of Mr. Carlos C. Antonio to Petitioner,
dated March 18, 1991), indicates that the said Schedule of Market Values was
prepared contrary to and unauthorized under Section 9 of P.D. 921 and its
implementing rule on Section 1.02 of AR No. 7­-77. The conclusion is, therefore, inevitable that the said Schedule
of Market Values, having been prepared by the respondent City Assessor contrary
to the express provision of and without authority under Section 9 is illegal
and therefore void.

This Board is of the considered view that the E.O. No. 392 has not
repealed P.D. No. 921.

Laws are repealed only by subsequent ones (Art. 7, New Civil
Code). An executive order (like E.O.
No. 392) cannot repeal a legislative act (like P.D. 921) (Largado vs. Masaganda,
L-17624, June 30, 1962). A legislative
Act, therefore, can only be repealed by another subsequent legislative Act
(Hilado vs. Collector, L-9408, October 31, 1956). Well-recognized by all civilized nations is that a decree issued
by the commander-in-chief of the armed forces who is the head of state and
exercising law-making powers under martial law is in the nature of a
legislative act (Ex-parte Milligan, 4 Wall 2).

Granting for the sake of argument, that E.O. No. 392 was a valid
repealing act that abolished the Metropolitan Manila Commission, yet the said
Executive Order did not in any manner affect
the life of P.D. 921 nor the assessment districts and committee created therein
under Section 9 thereof nor its provision regarding the preparation of schedule
of market values for real properties within the Metropolitan Manila Area.

So that, whether it is named Metro Manila Commission or Metro
Manila Authority, P.D. 921 remains effective until validly repealed by
subsequent legislation through Congress (Hilado vs. Collector, supra). Furthermore, implied repeals are never
favored in our jurisdiction (U.S. vs. Palacio, 33 Phil. 208). Expressed otherwise, the Local Treasury and
Assessment Districts created by P.D. 921 has a life independent of the Metropolitan
Manila Authority, and the abolition of the
Metro Manila Commission does not follow the abolition also of P.D. 921 or the
Treasury and Assessment Districts under Metropolitan Manila. Moreover, a perusal of E.O. 392 shows that
it provides no repealing clause and that it does not contain a specific
provision relative to preparation of schedule of values. It is then clear that Section 9 of P.D. 921
still subsists and is the controlling provision with respect to the manner of
preparation of schedule of values for Metropolitan Manila.

This Board considers untenable the allegation in the Comment
submitted to the Supreme Court for Respondent Hon. Undersecretary Victor C.
Macalincag, that the Respondent City Assessor has authority to prepare alone
the questioned Schedule of Market Values for the reason that Section 9 of P.D.
921 refers to a general revision and has no application to selective
revaluation or assessment of properties in a certain local government
unit. There is nothing in the provision
of Section 9 where we should distinguish between a general revision or
revaluation or reassessment in the preparation of the Schedule of Market Values
for Metropolitan Manila, as basis for the appraisal and assessment for taxation
purposes of real properties located in the area. “Where the law does not distinguish we should not
distinguish.”

As this Board has ruled that the questioned Schedule of Market
Values is illegal and, therefore, void, the review and findings of the created
Technical Review Panel, that the said Schedule of Market Values was prepared in
compliance with the “instructions” embodied in the Assessment
Regulation No. 7-77, will not render valid the void Schedule of Market Values.

Petitioner further assailed the legality of the Schedule of Market
Values in question on the ground that it was not approved by the Secretary of
Finance, but by Respondent Undersecretary Victor Macalincag contrary to Section
15 of P.D. 464.

We believe that it is at this point immaterial to determine whether
or not the questioned Schedule of Market Values should be approved by the
Secretary of Finance himself. The fact
being that the said Schedule of Market Values as approved by Respondent
Undersecretary Macalincag is void from its preparation.

As repeatedly emphasized by our Supreme Court in a line of
jurisprudence, “an illegal act confers no rights, creates no duties, and
in the eyes of the law, it is as if the same had never existed. It can be slain at sight.” Such is the
case of the questioned Schedule of Market Values, which is hereby declared void
and without force and effect. Therefore, the realty tax rates based on the Schedule of Market Values
are likewise void and unenforceable.

Further, considering that this Board in its findings ruled on the
illegality of the Schedule of Market Values as prepared by the Respondent City
Assessor, the question of notice of assessment is rendered moot and academic.

WHEREFORE, judgment is hereby rendered, declaring, as this Board
hereby declares, null and void, and, therefore, unenforceable the subject
Schedule of Market Values for all classes of lands in Quezon City, as prepared
solely by Respondent City Assessor being contrary to and in violation of
Section 9 of P.D. No. 921. Respondents
City Assessor and Treasurer of Quezon City are hereby ordered to act
accordingly.

This Board hereby declares null and void, and, therefore,
unenforceable, the subject Schedule of Market Values for all classes of lands
in Quezon City, as prepared solely by Respondent City Assessor, being contrary
to and in violation of Section 9 of P.D. No. 921.”

The Board also rejected
the respondents’ argument that “the subsequent issuance of Executive Order
No. 392, constituting the Metropolitan Manila Authority on January 9, 1989, has
in effect abolished the Metro Manila Commission, and therefore has ceased to
function.” It ruled that Executive Order No. 392 could not repeal a
legislative act like P.D. No. 921, and that even assuming that Executive Order
did abolish the Commission, the former “did not in any manner affect the
life of P.D. 921 nor the assesssment districts and committee created therein
under Section 9 thereof nor its provision regarding the preparation of schedule
of market values for real properties within the Metropolitan Manila Area.”

The Central Board of
Assessment Appeals rendered its decision in the second case, G.R. No. 97760
(CBAA Case No. 262) (Javier v. Macalincag), on May 7, 1993, which it
transmitted to this Court by letter of its Chairman dated May 17, 1993. It pronounced null and void the Schedule of
Market Values for Pasig solely prepared by its Municipal Assessor. Said the Board:

“The argument of Respondents about the meetings of the League
of City and Municipal Assessors to consider the proposed schedule for Quezon
City or Pasig, for that matter, is untenable. The League has no authority to prepare the Schedule of Market Values,
for not having been constituted in accordance with Section 9 of P.D. 921 and
2nd par. of Section 1.02 of DOF AR No. 7-77 which pertained only to the Districts
created under Section 1 of P.D. 921. But even granting that the League has authority, the League did not
extend any hand in the preparation of said schedule. Consideration or discussion thereof, is not preparation.

In this Board’s Decision on
CBAA Case No. 261 G.R. No. 97618, ISMAEL A. MATHAY, JR., Petitioner, vs. THE
HON. VICTOR C. MACALINCAG (Undersecretary of Finance), et al., the dispositive
portion thereof reads as follows:

‘This Board hereby declares null and void, and, therefore,
unenforceable, the subject Schedule of Market Values for all classes of lands
in Quezon City, as prepared solely by Respondent City Assessor, being contrary
to andin violation of Section 9 of P.D. No. 921.’

As in the Mathay case, the same issues were substantially raised in
the Javier case. It would be utter
folly for this Board to apply the same law differently to the latter case. What is good for the goose should be good
for the gander. The principle of State
Decisis impels this Board to abide by its Decision to stand as precedents for
future judgments.

WHEREFORE, judgment is
hereby rendered, declaring null and void the instant Schedule of Market Values,
prepared solely by the Municipal Assessor of Pasig, for lands in Pasig, Metro
Manila, in violation of Section 9 of P.D. 921. Respondents Municipal Assessor and Municipal Treasurer of Pasig, Metro
Manila, are hereby ordered to act accordingly.”

The Board pronounced
judgment in the third case, G.R. No. 102319 (CBAA Case No. 263) (Consuelo
Puyat-Reyes v. Secretary of Finance, et al.) on October 5, 1993. This it also sent to this Court, together
with the records, on October 18, 1993.

The decision states that in March, 1993, the Board allowed two
(2) firms to make common cause with petitioner Puyat-Reyes as petitioners-in-intervention,
namely: Ayala Land, Inc. (ALI) and
Makati Commercial Estate Assocation, Inc. (MACEA), “owners/lessees of real
properties located within the Municipality of Makati;” and that compromise
agreements were arrived at and submitted by Puyat-Reyes and the respondents, as
well as by the latter and the intervenors.

The Board declared the compromise agreements to have no legal
basis and hence unacceptable under Article 1306 of the Civil Code. And it disposed
of the merits of the controversy as follows:

“Still fresh from its memory, this Board cannot simply set
aside its decision on CBAA Cases Nos. 261 (Ismael A. Mathay, Jr. vs. the Hon.
Victor C. Macalincag, Undersecretary of Finance, et al.), and 262 (Rufino S.
Javier vs. the Hon. Victor C. Macalincag, Undersecretary of Finance, et al.)
and disregard the principle of stare decisis. This Board must abide or adhere to decided cases, especially and more so
when such decisions emanate from the Board itself.

WHEREFORE, judgment is hereby rendered, declaring null and void the
instant Schedule of Market Values, prepared solely by the Municipal Assessor of
Makati, for lands in Makati, Metro Manila, in violation of Section 9, P.D. 921
and the Compromise Agreements, entered into by and between the Petitioner and
Respondents and among and between the Intervenors and Respondents, inexistent
and void and without force and effect. Respondents Municipal Assessor and Municipal Treasurer of Makati, Metro
Manila, are hereby ordered to act accordingly.”

The Court has reviewed the records of all these three (3) cases
and finds that the Central Board of Assessment Appeals has proceeded correctly
as regards their hearing and determination. It also agrees with the Board’s conclusion that the Schedules of Market
Values for real property located in Quezon City, the Municipality of Pasig and
the Municipality of Makati, respectively prepared solely by the City Assessor
of Quezon City, and the Municipal Assessors of Pasig and Makati, failed to
comply with the explicit requirements of Presidential Decree No. 921 in
relation to the corresponding Administrative Regulations promulgated by the
Department of Finance (No. 7-77) on July
25, 1977, and are on that account illegal and void. The Court therefore hereby approves and
adopts as its own the following dispositions made by the Central Board of
Assessment Appeals in all said cases, to wit:

1) RE G.R.
No. 97618 (CBAA Case No. 261)

“This Board hereby declares null and void, and, therefore,
unenforceable, the subject Schedule of Market Values for all classes of lands
in Quezon City, as prepared solely by Respondent City Assessor, being contrary
to and in violation of Section 9 of P.D. No. 921.”

2) RE G.R.
No. 97760 (CBAA Case No. 262)

“WHEREFORE, judgment is hereby rendered, declaring null and
void the instant Schedule of Market Values, prepared solely by the Municipal
Assessor of Pasig, for lands in Pasig, Metro Manila, in violation of Section 9
of P.D. 921. Respondents Municipal
Assessor and Municipal Treasurer of Pasig, Metro Manila, are hereby ordered to
act accordingly.”

3) RE G.R.
No. 102319 (CBAA Case No. 263)

“WHEREFORE, judgment is hereby rendered, declaring
null and void the instant Schedule of Market Values, prepared solely by the
Municipal Assessor of Makati, for lands in Makati, Metro Manila, in violation
of Section 9, P.D. 921 and the Compromise Agreements, entered into by and
between the Petitioner and Respondents and among and between the Intervenors
and Respondents, inexistent and void and without force and effect. Respondents Municipal Assessor and Municipal
Treasurer of Makati, Metro Manila, are hereby ordered to act accordingly.”

IT IS SO ORDERED.

Cruz, Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Romero,
Nocon, Bellosillo, Melo, Quiason, Puno, and
Vitug, JJ., concur.

^[1]
Per its Chairman, Hon. Margarita G. Magistrado, whose opinion was concurred
in by Hon. Eleanor A. Santos, Member, and Hon. Alfonso M.
Medado, Member